The board will immediately act on all the AG's findings on HR and wasteful expenditure at SABC - by instituting legal /criminal proceedings against perpetrators.
It is in full agreement with AG that the underlying causes have been:
- Lack of quality reporting, governance arrangements and leadership oversight
- Inadequate monitoring and oversight by the leadership of the SABC
- The creation of an environment where "the tone at the top" is “inappropriate”.
- A culture where management is not focused on public accountability or acting
in the best interest of the SABC".
Some Findings:
- At least 34 employees were suspended for an average of 10.4months - in some cases for up to 39 months - on full pay, at a cost of R8.3-million
- 7 tenders awarded for an aggregate amount of R174-million were NOT approved by the appropriate levels stipulated in the delegation of authority framework.
- 20 employees at the broadcaster are directors or members of companies that had received payments from the SABC to the amount of R3,4-million.
- 2 contract awards amounting to R8,4-million and R8,2-million, were not approved in accordance with the DAF.
- The former CEO entered into a material agreement for R326-million with a consultant in September 2006, even though he did not have the authority to do so.
- No corrective action had been taken by EXCO to address deficiencies in the acquisition of international program content, despite the advice of a forensic investigation in August 2007.
- Irregularities of R111,75-million relating to:
- Double payments
- Overpayments
- Material paid for but not received
- Agreements that had to be renegotiated
- Program titles acquired more than once, from the same supplier.
- Concerns and detailed findings were brought to the attention of the Acting group CEO in September 2008, but NO corrective actions were implemented!
- R11,3-million was paid to a private travel company (instead of SABC Travel Office), in contravention of the SABC's travel policy.
- SABC board members and Execs who travelled with their partners to the Olympic Games were liable for tax arising from the fringe benefits in terms of the Income Tax Act - however, payroll was not notified of the benefits so did not levy the tax to execs or board members.
- An "environment where management and those responsible for oversight were perceived as being indecisive" and contributed to an organisational culture of "impunity".
THE MINISTRY OF COMMUNICATIONS WILL:
* Conduct a thorough assessment and clearly define roles of and the authority allocated to executive and/or senior managers.
* Review Human Resource policies and implementation thereof.
* Review benefits applicable to management in particular and staff in general.
* Review policies governing the involvement of employees in private business activities.
* Requesting monthly management accounts from the SABC.
* Active and permanent shareholder participation in the various committees of the SABC board, i.e. Risk, Audit and Internal Audit Committees.
* Ensuring that all major decisions, financial or otherwise, have the full approval of the Group Executive Committee, the Board of Directors and the Shareholder.
* General compliance with the Public Finance Management Act (PFMA).
* Require monthly operational reports to monitor implementation.
* Conduct a need analysis of SABC channels to determine the type and amount of content they require.
* Monitor the implementation of the local content quota and conduct a thorough assessment of the need for and the acquisition of international content and ensuring that content is used.
CALL TO ACTION:
Please assist the Ministry in understanding the reasons it took such a long time for this sad state of affairs to surface.
The Ministry of Communications will thoroughly scrutinize previous reports of the Auditor General and SABC internal and external auditors.
* * PLEASE CONTACT THE MINISTRY IF YOU ARE AWARE OF ANY OLD REPORTS THAT HAVE BEEN SUPPRESSED BY EXCO AND HR. * *
Where transgressions are found to have been committed (especially covering up), law enforcement agencies will move swiftly in bringing the perpetrators to book.
Ministerial Statement:
The SABC is a crucial institution of our democracy and everything should be done to save it from further ruin. It is the main and reliable source of information and entertainment services for the public, particularly the needy, providing broadcasting services to 24 million people on a daily basis.
We are encouraged by the conclusion of the process of selecting members of the SABC Board, pending the ratification of the recommended candidates by the President. We believe that this is a major milestone that will undoubtedly create an enabling environment for the efficient implementation of the recovery measures for the SABC.
We are equally grateful for the sterling work done by the interim board since it took office almost three months ago under challenging conditions.
